“Such guidelines should lead to greater levels of consistency in the assessment of general damages in Ireland, which should help in better enabling the domestic non-life insurance sector to support its customers,” Mr Sibley said at a Central Bank insurance conference in Dublin on Friday.

The comments come a day after it emerged that Minister for Justice Charlie Flanagan had asked judges to set up a committee with representatives of the Personal Injuries Assessment Board (PIAB) and Department of Justice staff to review guidelines for minor personal injury claims, including whiplashes and soft-tissue injuries.

Stopgap measure

The setting up of a committee is considered a stopgap measure to try and reduce insurance costs ahead of the setting up of a judicial council, which would require enabling legislation to be passed.

Meanwhile, Mr Sibley said that Irish-based insurers need to work more on plans for their recovery or wind-down should they run into trouble. European banks have had to draw up such plans – or what are known in the banking world as “living wills” – to satisfy regulators in the wake of the financial crisis.

“The regulatory regime for insurance is not sufficiently robust or consistent across Europe, ” said Mr Sibley.

“This issue is accentuated by the inconsistency in insurance compensation schemes across Europe – an issue for both home and host supervisors. As well as pushing for further developments at a European level, the Central Bank is driving firms to improve how they execute recovery planning as well as advancing our own approach to resolving insurance firms.”